The U.S. Department of Defense is expanding its use of an emerging technology that combines radio waves and computer networks to track shipments of military supplies, in what some consider the largest project of its kind.

The massive government agency, which runs the Army, Navy, Marines and Air Force, has recently expanded a multimillion contract for so-called radio frequency identification (RFID) technology, according to one of the military's primary suppliers of RFID equipment.

RFID systems have been touted during the past several years as a potentially major advance in the field of logistics, giving people the means to track the movement and location of supplies as well as identify particular shipments. The way they work is by attaching special "tags" containing microchips to an object, such as a container of ammunition. The tag emits radio waves, transmitting a unique identification code that can be read by radio frequency scanning devices in an object's vicinity.

People can place scanning devices in storage facilities or air bases to monitor the coming and going of tagged supplies and relay the information to computers that trace the path of each object. Using a personal computer attached to such a network, a person could determine the location of their supplies.

Commercial use of the technology has been fairly limited because of the high cost of the equipment required, particularly the "tags" attached to supplies being tracked.

Broader adoption appears to be around the corner, however. Razor maker Gillette recently purchased 500 million RFID tags that it's testing at Wal-Mart and U.K.-based Tesco stores. It's using the technology to set up "smart shelves" that can sense when Gillette stock on store shelves are running low and send alerts via networked computers to store managers.

The government's use of the technology, however, has advanced more quickly. The Department of Defense set up its RFID system, dubbed the Total Asset Visibility (TAV) network, eight years ago after fumbling the shipment of supplies to troops in the Gulf War, according to executives at Savi Technology, an RFID supplier to the agency based in Sunnyvale, Calif.

The military has already used the system to coordinate the shipment of supplies to troops in Somalia and the Balkans, said Fraser Jennings, senior director of industry relations at Savi. It's possible that the government is using the system to help ship supplies to troops now being deployed in the Middle East in preparation for a war with Iraq, Jennings said. A representative at the Department of Defense said that's indeed possible but wouldn't absolutely confirm it.

The TAV Network, which utilizes the Internet as part of its infrastructure, has helped the military more efficiently deliver supplies to troops and bases around the world, according to Savi and the Department of Defense. During the Gulf War, the government lost track of many supply shipments, leading to redundant deliveries and wasted resources, Jennings said.

Savi, a privately held company that makes RFID tags, readers and software, claims the TAV network is the largest RFID network in the world in terms of geographic scope. Under a $190 million contract with Savi, the military has tagged more than 270,000 cargo containers and placed readers in about 400 locations in 40 countries, including sea ports, military bases and rail yards in Asia, Europe, the United States and the Middle East, according to Savi.

"In terms of using RFID to track ocean-based shipments across multiple ports around the world, the TAV network is certainly the most extensive network," said Adrian Gonzalez, director of logistics research at information technology analyst firm ARC Advisory Group.

The Department of Defense recently signed a three-year contract with Savi valued at up to $90 million to grow and update the system, Savi announced this week. The company is also working to sell its RFID systems to commercial enterprises and ports, and is already conducting tests with retail chain Target, Jennings said.

It's ironic that the government is stepping onto the leading edge of RFID technology, noted Savi spokesman Mark Nelson, because it's typically businesses that lead the way in adopting information technology to become more efficient.

"RFID technology has hit a lot of failed science experiments in the commercial sector," said Nelson. "The military has shown that, when used correctly, over time it provides tremendous value and operational benefits."